Fiscal reform 'on the track'

Manama

The Cabinet chaired by His Royal Highness Prince Salman bin Hamad Al Khalifa, the Crown Prince, Deputy Supreme Commander and First Deputy Prime Minister, yesterday praised the positive preliminary forecasts of the fiscal results for the year 2019 compared with 2018, which indicate a reduction of the primary fiscal deficit by 85 per cent (excluding public debt interest), and a reduction in the total fiscal deficit of 24pc (including public debt interest).

The initial results further revealed an increase in non-oil revenue by 63pc, and a decrease in public expenditure by BD128 million. Furthermore, according to the estimates, economic growth reached 2.1pc in 2019, largely driven by 2.3pc increase in non-oil sector growth.

The Cabinet noted that the Kingdom witnessed positive growth in 2019, in parallel with the implementation of the initiatives under the Fiscal Balance Programme and supported by the positive growth of non-oil sectors, itself a result of economic diversification initiatives within Bahrain’s Economic Vision 2030.

The fiscal improvements follow the implementation of a number of reform measures taken by the government as part of the Fiscal Balance Programme, initiated in October 2018. The programme aims to deliver a balanced budget by 2022. 

Reforms implemented include a government wide spending review and dedicated spending efficiency taskforces, new spending controls, a voluntary retirement scheme for public sector workers and the implementation of VAT.

The ministry also announced positive GDP growth figures.  According to the estimates, economic growth reached 2.1per cent in 2019, largely driven by a 2.3pc increase in non-oil growth. The Kingdom forecasts strong growth to continue into this year, with GDP expected to expand 2.7pc in 2020.

The Minister of Finance and National Economy, Shaikh Salman bin Khalifa Al Khalifa, said: “From the outset we have sought to implement an ambitious but balanced fiscal reform package in the Kingdom of Bahrain, with consolidation not being achieved at the expense of economic growth. Today’s figures are testament to this approach. The government is 100pc committed to its path of fiscal reform and sustainability, and to delivering a balanced budget by 2022.” 

Among other things, the Cabinet approved a Draft Resolution specifying the regulations and requirements of mobile food truck services within residential locations. The requirements include leaving a distance of at least 20 meters in all directions from neighbouring buildings, and a distance of 50 meters from any road intersection, roundabout or traffic lights.

The Draft Resolution further determines the period of service activity from 6 am to 12 midnight, and that food vehicles must leave the residential areas along with all equipment or furniture after completing the provision of their services.

The Cabinet approved three MoUs and an Executive Programme, submitted by the Minister of Foreign Affairs, between the governments of the Kingdom of Bahrain and the United Arab Emirates, to co-operate across various fields, including human resource development, media, electricity and water, as well as co-operation between national committees, regarding the prohibition, use, production, and storing of chemical weapons, and the destruction of these chemical weapons in the Kingdom in collaboration with the UAE’s Committee for Goods and Materials Subject to Import and Export Control. 

The Cabinet reviewed a report submitted by HE the Minister of Health regarding the measures taken to intensify supervision and inspections on retail shops, restaurants, and salons, ensuring the implementation of the cabinet decision taken on this topic.